Posts Tagged ‘interest rates’

McDonald Group Real Estate Trends: It’s Still a Buyer’s Market in Portland

Wednesday, September 15th, 2010

The latest market report for the Portland Real Estate market shows a steady level of continued price reductions on homes for sale around the Portland Metro area. Back in August we talked here on the McDonald Group Real Estate blog about the Portland Business Journal article stating that thirty-two percent of Portland homes for sale in early summer experienced at least one price reduction, ranking  Portland No. 16 on Trulia’s list of price reductions in America’s 50 largest cities. Those numbers are sticking around.

A buyers market is one in which there are more homes available that there are people ready and willing to purchase them. With so many options to choose from in the Portland Real Estate market, buyers have the opportunity to pick up ridiculous deals on homes for sale in Portland that would otherwise be snapped up for much more. The buyers market means more options, lower prices, and higher competition amongst sellers, which makes homeowners and Portland real estate agents more willing to compromise and negotiate price reductions on all types of homes.

Signs of a buyers market in Portland are everywhere – this is the time to upsize or move into a more desirable area, as there are literally hundreds of gorgeous homes at rock bottom prices, including luxury foreclosures, high-end short-sales, bank-owned homes, and affordable listing prices on homes priced well below their previous market value. A balanced buyer/seller market has around 5 or 6 months of inventory. The Portland Real Estate market is currently just below 11 months. If you’re trying to sell a home in Portland, you’re going to need to price competitively and think about upgrades to make your house more attractive to the increasingly savvy buyers. The average sale price in the Portland Real Estate market is around $297,000 and homes for sale in Portland typically stay on the market for around 121 days. There’s really no good way to tell how long this buyers market will last, so be sure to take advantage of these record low prices, record low interest rates, and the amazing supply of affordable dream homes out there on the Portland Real Estate Market.

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Portland Realtor Guide: NEW Buckman Neighborhood Profile at Your Road Map to Home

Friday, August 20th, 2010

Check out the new neighborhood profile detailing the neighborhood of Buckman in Southeast Portland, filled with quirky culture, classic Old Portland homes, and some of the best dining and shopping in town. The Buckman neighborhood is progressive and proud, and provides easy commuting access downtown via the Burnside, Hawthorne, and Morrison bridges. Buckman includes parts of two of the most popular retail districts in town, Hawthorn and Belmont Streets, complete with vintage stores, great brunch spots, and open parks.  Combining the best of urban accessibility and comfortable, small-neighborhood atmosphere, Buckman is quintessential Portland.

If you’re looking for homes, condos, or other real estate in Buckman or other Portland neighborhoods, check out this information page filled with the best restaurants nearby Buckman, top hikes and green spaces, and neighborhood resources. Relocating to a new area can be hard, but it’s a lot easier when you’ve got the best real estate agents in Portland on your side.

Contact the McDonald Group realtors to find out about homes for sale in Buckman, or Click here for more information!

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Portland Real Estate Trends: Homeowners Slashing Prices

Thursday, August 12th, 2010

In a report published in the Portland Business Journal yesterday, we learned that thirty-two percent of Portland homes for sale, listed since the beginning of this month, experienced at least one price reduction. That ranked Portland No. 16 on the website Trulia’s list of price reductions in America’s 50 largest cities.

The average reduction for Portland homes was 9 percent, just under the national average of a 10 percent reduction on 25 percent of newly listed homes. With historically low interest rates, cutting-edge sustainability renovation rebates and low remodeling costs, and a high supply of beautiful homes for sale with great Walk Scores, this is a perfect time to grab a great deal.

As Scott McDonald of the McDonald Group said back in June, “We all know mortgage rates are low right now, but Freddie Mac really put a light on it by saying they are currently lower than they have been since they began tracking this data in 1971 and MSNBC.com states the last time they were this low was in the 1950′s. Yup, the economy stinks right now, but if you’re in a position that’s somewhat insulated from economic trends and are thinking of buying a home, now really is the time.”

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Interest Rates: they won’t be going down but they will be heading up…

Friday, April 16th, 2010

There’s a great article in the New York  Times touching on this very topic.  I have many clients waiting for home prices to further drop before finding their home match but the reduced home prices should be balanced with the rising interest rates.  Unless you are paying cash you may pay in an interest rate what you’d be saving in a reduced home price AND all the while missing the time you could be spending in your new home!  A great lender, Steve Nassar of Alpine Mortgage says:

  • A 1% increase in the interest rate can add as much as 19 percent to the total cost of the home
  • The Mortgage Bankers Association expects the rise to continue, with the 30-year mortgage rate going to 5.5% by late summer and as high as 6% by the end of the year.  
  • Some firms, like Morgan Stanley, are predicting that rates could rise by a percentage point and a half by the end of the year.

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A Few Articles Re: interest rates rising & FHA tightening on loan standards

Thursday, January 21st, 2010

Clients of ours forwarded the linked articles below to us for consideration; I’m passing along to you. I do expect FHA will continue to tighten and I do think interest rates will go up. For those of you thinking you want to wait for home prices to reduce, keep in mind that an increased interest rate may eat up any sale price savings and that if you are borderline qualified you may not be eligible for a loan a month from now. If you are a first time home buyer I do not recommend writing on short sales unless they already have a pre-approved amount acceptable to what you would want to pay.  Chances are slim you would close in time for the credit and they waste alot of valuable shopping time. Here’s those articles:

FHA RAISES FEES, TIGHTENS LOANS STANDARD

FED PLAN TO STOP BUYING MORTGAGES  FEEDS RECOVERY WORRIES

Interest rates climbing, doubtful we’ll see a return to sub-5% rates anytime soon

Tuesday, June 9th, 2009

Interest rates are well over 5% now, roughly 5.3% last week now at 5.5% and still climbing. Yesterday in fact there were several rate increases climbing_interest_ratesthroughout the day with some lenders stating their base rates are now at 5.75%. Several lenders we work with feel there could be another slight dip in rates later this year however that would jeopardize the tax credit for those of you in the market to take advantage of it, in other words waiting *might* get you a half point lower rate if those lenders are correct however it will cause you to miss the tax credit deadline to be closed on a home purchase.

Historically rates are still very low however we’re about to move back into “typical” waters with rates and could see them begin to climb rapidly. With the debt load on the country and the massive spending over the last year, and continuing, inflation is bound to pick up pace and as a result we’re likely to see rates rise sharply to stem inflation. We can only hope we don’t see late 70′s early 80′s rates in the high teens but it is possible and some economists are warning it’s already unavoidable; time will tell. If that does happen we’ll be moving from one devastated market into another; here’s to hoping those worst fears from some economists are wrong.

~Scott McDonald : Your Oregon Real Estate Resource

Solution to the Housing Market. I agree with Jim!

Monday, May 4th, 2009

jimJim Gillespie, president of Coldwell Banker was recently interviewed on Fox Business news and he said alot of great stuff (you can watch the video from the link below or just click play on the YouTube.com version under the link). In summary he suggests two things:

$15,000 tax credit for all buyers of primary residences: I am in such agreement. The 8,000 has done a great job getting the first time home buyers out there, a $15,000 tax credit to all primary home buyers (not just the first time home buyers) would really get this market moving!

I’m finding that the majority of the homes that are moving are $200,000 and under and a large portion of those are already vacant. If we could get the homes in the higher price point moving it would start a healthy domino effect. What is hurting the home seller right now is the pricing of all the bank owned homes that are hitting our market (in Portland, Oregon anyway) and more home sales (that such a credit would encourage) would prevent more homes from going into foreclosure and allow more home homeowners to sell at a price that isn’t short of what they owe the bank.  

Lock in the interest rate for 12 months at 4% or 4.25% for a 30-year fixed:Because so many buyers are “waiting” for interest rates to drop further (of which they may or may not do) we have alot of buyers out there that are sitting on the fence. If we were to lock something in for a pre-determined amount of time there would be no more waiting. This would really unclog the pipe

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Waiting for the Bottom? You’re Likely to Miss it & Miss Out…

Tuesday, April 28th, 2009

The big question, when will we hit bottom or have we already? As Realtors we and others in the industry that we work with daily are frequently hearing buyers saying they are waiting for the bottom to buy; hence the point of this blog entry. Keep in mind statisticsmandg_housing_market_freefall1 and trends are found and compiled after events, not before them thus if you are waiting for confirmation on hitting bottom you’re pretty much guaranteed to miss it. Additionally think about this, in Portland we’re seeing -2% to -7% depreciation rates, so lets say on a $300,000 home if you’re “waiting for the bottom” then you’re betting that home would be $285,000 in one year at -5% *if* (and that’s a huge if) we continue to see a solid decline for the next year, so you’d save $15,000 right?

You need to look at the whole picture: Last year at this time interest rates were around 6.2%, now interest rates are at record lows at around 4.8% so that home at $300,000 is going to cost you about $1,575/month in payments to buy it now. Considering this time last year interest rates were around 6.2%, it’s entirely possible they would be there again next year (or higher, 7%? 8%?) and most lenders would agree it’s very unlikely they will still be at current levels or lower. So lets say you’re gamble panned out, you can buy the same home for $285,000 in 2010, but then interest rates have since gone back up to 6.2%. While you didn’t “lose” $15,000 in equity in the first year you are now losing $200/month in interest to your loan instead due to the difference in interest rates (and if you’re a first time home buyer, you also missed the $8,000 tax credit chewing up more than half of that avoided $15,000 loss). Considering 4.8% is unlikely to be seen again for decades, you won’t be re-financing out of that extra $200/month anytime soon either. This bet could end up costing you much more in the long run.

By all means if you want to make that gamble be my guest, but look at all the angles, be informed both in current events, rates & markets but also historical events, rates and markets as well. We know what the current conditions are and everything across the board is screaming “buyers market!”; do you really want to continue gambling and risk losing out on the market of a lifetime or buy at a rate and price that is likely to be the lowest possible in your lifetime?

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A Lender Opinion on the 4.5 Percent Interest Rate

Wednesday, February 11th, 2009

A great lender and friend of ours sent out an email today pertaining to the potential 4.5% interest rate we keep hearing about. Apparently he gets asked about it daily so decided to write sunset (more…)

Interests Rates Below 5%, Could Take Longer to Close on Your Home.

Monday, January 19th, 2009

We’ve been finding that the typical 30 days (or less) to close is more difficult these days as the lenders are busy (more…)